Tag Archives: economy

The deficit reduction supercommittee is apparently bogged down in the usual partisan squabbles. Big surprise. The Democrats won’t accept a package of cuts only, and the Republicans balk at any tax increases. Will the threat of the nasty automatic cuts that will happen if there’s no agreement be enough to move anyone off dead center? The truth is that the budget can’t be balanced by cuts alone; some revenues must be increased to make things work. Republicans used to understand this. Ronald Reagan certainly did, but that was before the anti-tax pledge became a badge of conservative ideological purity. The image of a dozen Supermen trying to find their way out of the phone booth popped into my head while I was thinking about the issue. I’d like to believe I’m wrong, and that these guys for once will put people ahead of party politics, that a dozen brave superheroes will come flying to the rescue, but I’m betting the phone booth wins.

I was working my way across the radio dial on my way home the other night, delighted to hear the right-wing blathersphere ablaze with denunciations of the Occupy Wall Street demonstrators, a sure sign that they’re starting to have an impact. Oh, those commies, those hippies, those radicals, those anarchists, those evil revolutionaries and their nefarious plot to destroy capitalism! How dare they trumpet the obvious, that Wall Street bankers are not really on the side of the working stiff (or in way too many cases, of the no longer working stiff) that perhaps the Emperors of Finance have too many clothes, while the rest of us don’t have enough. We now live in a country in which the top one percent receive a quarter of all income, and control more than 40% of the nation’s wealth. I’ve been wondering when the other 99% would finally take to the streets. I only hope this thing continues to grow until we see massive demonstrations, angry mobs of ordinary Americans demanding real change, and deaf and blind politicians finally being forced to listen to their constituents and not just to the K Street lobbyists. Power to the people! It’s about time.

I’m guessing that the Lords of Wall Street aren’t particularly interested in anything the protesters have to say, unless they have a cool tip on a new way to make obscene amounts of money by spinning off esoteric derivatives, insider trading, or taking the economy to the brink and getting billions in bailout money, all of which will turn magically into huge underserved bonuses. The disconnect between the world of the bankers and the world of the unemployed, the foreclosed and the uninsured is so great that the folks who brought this economy to its knees apparently have no concept of the suffering the rest of the nation is enduring. One wonders if they even care.

You’ve got to love the thinking here. Obama proposes a hefty $450 billion jobs bill, containing many items that Republicans used to favor. The tab is to be paid by raising taxes on the wealthiest Americans to their pre-Bush tax cut levels. The Republicans (surprise) oppose asking the rich to pay for the jobs the bill would create because the rich will use that money (drumroll, please) to create jobs. That no jobs have been created in the years since the tax cut was enacted does not deter the GOP from fantasizing that it will happen this time. In the meantime, the gap between the rich and poor continues to widen while we wait for those mythical jobs to come pouring out of the gated communities of the well-to-do.

A lot is being made these days of the so-called Texas miracle, in which that state has bucked the national unemployment trend. Governor Rick Perry hopes to ride that success all the way to the White House, with the promise of extending that miracle to the rest of the country. Sounds great, doesn’t it? Except there’s something decidedly less than miraculous when you dig a little deeper. First of all, Texas’ unemployment is hardly anything to brag about, Yes, it’s below the national average, but only by a little. Many of the jobs pay minimum wage or less. Texas boasts a huge number of working poor, as evidenced by a poverty rate well above the national average. One-fourth of the state’s children live below the poverty level. The number of uninsured, highest in the nation, should be a national scandal. Yet he’ll have nothing to do with any rational health care reform. Perry’s answer to his state’s problems? Cut benefits for the poor and unemployed. Cut Medicaid. Cut education. And pray for divine intervention. I didn’t even mention his stance on climate change in the cartoon. The drought, predicted by climate scientists who study such things, has hit his state hard. Wildfires continue to burn across wide areas of the state. Perry’s hatred of the federal government and taxes hasn’t stopped him from applying for federal disaster relief–paid for by tax money. Perhaps his weird contempt for the good done by Social Security for the past 75 years will derail his ambitions, but don’t count on it. He is a prodigious fund-raiser and a dogged campaigner. He’s at least an even bet to win the nomination. Maybe we should all be praying for a different miracle.

Yesterday, the last of the recall elections in Wisconsin were decided. All told, more than $35 million was spent to overturn two seats in the Wisconsin statehouse. That was just for the campaigns. I don’t know how much the state of Wisconsin spent to hold the elections. The total for the nine recall elections was double the amount spent on all 116 Wisconsin legislative races in the last election. Mind you, that was just for the state legislature. Given the historic unpopularity of Congress, and of politicians of all stripes, I propose that we recall all elected officials at every level everywhere in the country. Can you imagine the enormous amount of money that will suddenly flow into every corner of this nation? Corporations, which have been sitting on enormous stashes of cash, but have refused to hire people, will likely have no qualms about pouring money into those races. The political parties and lobbyists will throw record wads of cash into the fray to protect their turf. That’s money pumped directly into the economies of every city, county and state in the land. Recession over. And best of all, we might actually get rid of a fair number of the most annoying politicians. It’s a win-win.

The president, freed, at least temporarily, from the limit hostage crisis, has turned his attention, finally, to jobs. His problem, and the nation’s, is that there’s almost nothing he can do to create more jobs. Having tied himself to deficit reduction, he can’t very well call for the stimulus necessary to shake the economy out of its doldrums. Even a modest jobs program will cost billions, and more government spending is a virtual impossibility now that Obama has caved on the deficit. In his zeal to find common ground with Republicans who had no interest in compromise, Obama once again gave away too much and gained too little (in this case, nothing). Austerity is now the entire game plan at a time when more stimulus is desperately needed, and Obama will find there’s little he can do to turn the economy around before the next election.

Washington has zeroes in with laser-like focus on the most pressing issue of our day–the unacceptable level of unemployment. No, wait! Just kidding. It’s cutting the size of government, which of course, matters more than anything else to the millions of Americans who can’t find work, who have lost or are in are in danger of losing their homes, who can’t afford health insurance, who are increasingly desperate as this recession lingers on and on. As the day this country must raise debt ceiling or default on its obligations approaches, the president and the leaders of both parties are working day and night to hammer out an agreement cutting the deficit mostly by shredding the safety net; the only question is by how much and whether the rich will be asked to shoulder any of the burden, or whether it will fall entirely on the neediest and most vulnerable among us. Whatever happened to jobs being the most important thing on the agenda? Come back later. Preferably after the next election. Can’t you see we’re busy?

The upcoming “golf summit” with President Obama, House Speaker John Boehner, and late additions Paul Ryan and Joe Biden, may well produce the long-awaited agreement on deficit reduction, forestalling a default brought on by Republican (along with some Democrats) refusal to raise the debt ceiling. It will, even if it succeeds, do absolutely nothing to solve the more immediate problems facing us. Any agreement is bound to produce a certain amount of pain, especially among those who most need government help right now.

In so many ways, the whole issue of deficit reduction is a red herring. The party insisting on austerity now is the same one that two years ago was claiming that deficits don’t matter as the combination of the Bush tax cuts and two unfunded wars created a massive budget hole. When the economy imploded, however, the Party of No took aim at the much-needed but too small stimulus as reckless spending. Democrats, scared out of their wits by the last election, bought into the notion of budget cutting rather than stand for what they know is necessary: more stimulus. Thus the charade we now witness, in which the president and Congress will make a harmful budget deal and each will claim success.

Meanwhile, the economy, without any hope of government help in the near future, slides back into the doldrums, the jobless rate stays stubbornly stuck near 10%, business awash in cash lavish obscene bonuses on their executives while refusing to hire, and Washington fiddles.

There’s a very good reason to be wary of austerity measures in times of deep recession. It’s easy to portray government as some disconnected entity consuming vast resources, and that cutting off the money flow will somehow improve things. Easy and lazy. What gets cut when budgets are slashed? Teachers, government employees, aid to states, Medicaid, federal and state construction projects. In other words, people. More people are thrown out of work, those without health care get sicker, and the programs that help them are eviscerated. So, a vicious cycle of higher unemployment and smaller safety net. Will someone please explain to me how this will get the economy moving again?